### Re-employment at same or higher wages does not preclude compensation for loss of earning capacity.

The claimant, Birender Kumar Tiwari, was employed as a mechanic by Respondent No. 2 (Management).

On 18.05.2013, while working at a metro construction site, he sustained injuries to his legs and spinal cord after a heavy object fell on him due to a mechanical failure (breaking of the Kelly).

A medical board assessed his disability at 41%.

While the management admitted the employment relationship and provided some immediate medical expenses and temporary re-employment, the appellant insurance company contested liability.

The Commissioner, Labour Department, awarded compensation of Rs. 3,67,819/- plus 12% interest and a 50% penalty against the insurance company.

The insurance company appealed, arguing that since the workman was later re-employed at a higher salary, there was no "loss of earning capacity," and that they were not notified of the accident.

Whether brief re-employment at a higher wage precludes a claimant from receiving compensation for loss of earning capacity under the Act.

Whether the insurance company was liable for interest and penalty despite alleging a lack of notice regarding the accident.

The court primarily applied Section 30 of the Employees’ Compensation Act, 1923, which restricts appeals to "substantial questions of law".

It relied on the principle from *Golla Rajanna & Ors. v. Divisional Manager & Anr.* regarding the limited scope of such appeals.

Regarding functional disability versus re-employment, the court followed *Palraj v. North East Karnataka Road Transport Corpn.*, which established that even if a workman is provided alternative employment at the same or higher salary, they are still entitled to compensation based on the permanent loss of earning capacity in their original vocation.

The court also applied Section 4A of the Act regarding the mandatory payment of interest and penalties for delayed compensation.

The High Court rejected the appellant's first contention by noting that physical disability (41%) in a skilled role (mechanic) constitutes a loss of earning capacity regardless of temporary administrative re-employment or salary hikes.

Citing *Palraj*, the court reasoned that the inability to perform the original specialized task satisfies the criteria for compensation.

Since the appellant failed to raise the "no loss of earning capacity" argument before the Commissioner, it could not be introduced as a substantial question of law on appeal.

Regarding the second issue, the court found factual evidence—a communication dated 21.05.2013 bearing the insurance company’s stamp—proving that the insurer had been duly notified of the accident, rendering their claim of "lack of intimation" meritless.

It held that re-employment does not exempt an employer/insurer from paying compensation for permanent disability and that the penalty was justified due to the insurance company's prior knowledge of the accident.

The court directed the immediate release of the deposited compensation to the workman.